


































Advances in Politics and Economics 
ISSN 2576-1382 (Print) ISSN 2576-1390 (Online) 

Vol. 6, No. 3, 2023 

www.scholink.org/ojs/index.php/ape 

31 
 

Original Paper 

Analysis of the Impact of Unemployment and Reemployment on 

China’s Economic Growth 

Zheng Jingtong
1*

 

1
 Beijing No.80 High School, China 

*
 Zheng Jingtong, E-mail: 1433911577@qq.com 

 

Received: June 02, 2023         Accepted: July 09, 2023         Online Published: July 14, 2023 

doi:10.22158/ape.v6n3p31           URL: http://dx.doi.org/10.22158/ape.v6n3p31 

 

Abstract 

Unemployment and employment issues have consistently held significance in the context of a country’s 

economic development. In the aftermath of the pandemic, it becomes imperative for China to effectively 

address future employment pressures while concurrently enhancing people’s quality of life. This article 

aims to analyze the underlying causes of unemployment in the post-epidemic era, while also delving 

into the challenges associated with re-employment and its subsequent impact on economic growth. The 

findings of this study reveal that re-employment plays a crucial role in driving economic growth. 

Although China’s existing reemployment policies have yielded certain positive outcomes, there remain 

several policy-related concerns that necessitate macro-level adjustments and concerted efforts from 

enterprises. 

Keywords 

Unemployment, Reemployment, Economic growth, Post-pandemic era 

 

1. Introduction 

The issue of employment and unemployment holds significant importance in the field of 

macroeconomics. Prior to the outbreak of the COVID-19 pandemic, employment stability was already 

prioritized when analyzing the development of major economies worldwide. In the case of China, 

unemployment stands as a broad and significant macroeconomic concern. In order to sustain a 

high-speed economic growth rate of over 5%, China must effectively address future employment 

pressures while simultaneously enhancing the quality of life for its people.  

The Political Bureau of the CPC Central Committee, during its meeting on July 31, 2018, explicitly 

emphasized the importance of stable employment as the foremost priority among the “six areas of 

stability”. This recognition underscores the significance of employment stability as a vital factor in 



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ensuring people’s livelihoods and national security. High economic growth is typically positively 

associated with employment growth, as employment serves as the foundation for economic expansion. 

As a developing country, China confronts the challenge of maintaining rapid and stable economic 

growth while simultaneously grappling with an increasingly complex employment situation. Therefore, 

conducting in-depth research on the employment situation within the context of China’s economic 

growth and advocating for the establishment of an economic development strategy centered around 

stable employment holds excellent practical significance. This article will adopt a case study approach, 

focusing primarily on China as the research subject. It will analyze the current employment situation in 

China, closely examine the impact of unemployment and reemployment on China’s post-pandemic 

economic growth, and further explore the implications of China’s relevant economic policies. 

 

2. Analysis of the Causes of Unemployment in the Post-Epidemic Era 

Over the past three years, the outbreak of COVID-19 has severely impacted the economy, causing 

many businesses to face closure and operating difficulties. Due to the deteriorating economic situation, 

companies have to take measures such as layoffs, salary cuts, and reductions in human resource 

expenditures. Under such circumstances, the recruitment needs of enterprises have dropped 

significantly, leading to an increase in the number of unemployed people in society. The losses caused 

by the epidemic to enterprises are more reflected in the imbalance of the economic system, such as 

reduced consumption, difficulties in unemployment and reemployment, and interruption of supply 

chains. Unemployment in reality can be attributed to various factors, with the COVID-19 pandemic 

serving as a significant catalyst for the deterioration of employment and economic development. The 

epidemic has emerged as a decisive factor, exacerbating the challenges faced by individuals and 

businesses. It has caused a collapse in employment opportunities and disrupted economic growth. 

Unemployment can be broadly categorized into two main types: active unemployment and passive 

unemployment. Regardless of the type, both are influenced by external factors such as the state of the 

market economy and the prevailing trends in industry development.  

2.1 Active Unemployment 

Active unemployment, as defined, encompasses various scenarios where employees voluntarily leave 

their jobs or are unable to secure employment due to personal preferences, dissatisfaction with existing 

working conditions, or incompatibility with company culture and requirements. Some common 

examples of active unemployment include employees resigning voluntarily, being unsuccessful in job 

assessments conducted by new companies, becoming victims of internal corporate politics, 

experiencing conflicts with colleagues, engaging in frequent job switches without valid reasons, 

lacking the necessary skills or attitude for job requirements, suffering from severe illnesses or 

significant liabilities, and facing disciplinary actions for serious violations of company regulations. 

 

 



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2.2 Passive Unemployment 

Passive unemployment refers to those who are able to work and are willing to accept the current wage 

level but still cannot find a suitable job. This kind of unemployment is caused by uncontrollable 

objective reasons, leading to large-scale layoffs in enterprises, which can be alleviated through 

appropriate economic measures and policies. For example, unemployment due to economic adjustment 

or misallocation of resources, structural unemployment due to technological change, changes in 

consumer preferences, poor labor mobility, unemployment due to recession or depression due to 

economic cycle fluctuations, artificial intelligence, etc. These unemployment phenomena are closely 

related to economic development, industry changes and individual behavior. Therefore, corresponding 

financial measures and policies should be adopted to deal with different types of unemployment 

problems to promote the increase of employment opportunities and the stable development of the 

economy. 

 

3. Analysis of Factors Affecting Re-Employment Difficulties 

3.1 The Oversupply of the Labor Market 

The outbreak of the epidemic, coupled with ongoing economic transformation, has led to a surplus of 

labor in the market. Many businesses had to suspend operations or reduce production during the 

pandemic, resulting in a significant increase in unemployment. While the situation has improved with 

the gradual resumption of business activities, supply chain disruptions and logistics bottlenecks have 

hindered the full recovery of enterprises. As a result, many employers have been cautious in recruiting 

new employees, leading to a decrease in available job positions and downward pressure on wages. 

China’s rapid economic development over the past few decades has resulted in improved education 

levels and labor skills among the population. However, employment opportunities in traditional 

manufacturing industries have declined, while emerging industries are still in the process of maturing. 

This imbalance between supply and demand in the labor market has created challenges in terms of 

unemployment and re-employment. The mismatch between the skills possessed by job seekers and the 

skill requirements of available positions further exacerbates the difficulty of finding suitable 

employment opportunities. 

3.2 Imperfect Social Security System for Reemployment 

3.2.1 Challenges in Unemployment Security Policies and Laws 

China has implemented an unemployment security system comprising social insurance and social 

assistance to support unemployed individuals. The Regulations on Unemployment Insurance and the 

Social Insurance Law outline the eligibility criteria for unemployment insurance benefits and assistance. 

The “Interim Measures for Social Assistance” also provide social assistance measures such as 

employment assistance and minimum living security for the unemployed. However, despite the 

establishment of this system, certain issues remain that need to be addressed. One problem is the 

imperfect design of the unemployment insurance system and the ineffective implementation of 



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re-employment measures, which is an objective reality. From a legal standpoint, there is a lack of 

regulation and clarity in managing labor contracts, particularly in the context of full-time and part-time 

employment. This can lead to difficulties in guaranteeing the legitimate rights and interests of workers. 

Furthermore, age discrimination in re-employment poses a significant challenge. Cases like that of Mr. 

Wang, a highly educated executive in Shanghai, who faced difficulty finding a job due to age-related 

factors, highlight the issue. Age often becomes crucial for re-employment opportunities, 

overshadowing factors such as education and gender. Job advertisements with age restrictions are 

common, with some not accepting applicants over the age of 40 or even 35. Several countries have 

enacted legislation to address age-based selection criteria as a form of discrimination. It is crucial for 

China to engage in legislative or judicial discussions to tackle age discrimination and formulate tailored 

policies that consider the characteristics of different demographic groups. 

3.2.2 Enhancing Employment Platforms and Vocational Training for Effective Reemployment 

The current employment platforms have yet to fully utilize the potential of community-based labor 

security and employment service platforms in the new era. To address this, it is crucial to focus on 

strengthening the construction of these platforms. This can be achieved by implementing targeted 

management of unemployed individuals’ profiles, improving standardized procedures, and enhancing 

vocational training, identification, guidance, and job placement services. By establishing a 

comprehensive reemployment service system, the employment platform can better cater to the needs of 

the unemployed. Additionally, it is essential to foster collaboration with public employment agencies to 

facilitate data sharing, extend service coverage, establish comprehensive networking, and facilitate 

precise job matching. This collaborative approach will ensure a more efficient and effective 

reemployment process for individuals seeking job opportunities. Furthermore, in order to adapt to the 

new employment landscape of the digital age, emphasis should be placed on promoting vocational 

training programs. Private educational institutions and vocational training projects should be actively 

encouraged to provide training that equips the unemployed with the necessary skills required by 

emerging industries and sectors. Providing financial support tailored to different forms of employment 

interruption is crucial to assist individuals in their transition to new career opportunities. To facilitate 

successful reemployment, it is vital for relevant departments to implement targeted measures such as 

job training, career guidance, and personalized support for re-employees. By offering comprehensive 

reemployment services, individuals can receive the necessary assistance and guidance to effectively 

reintegrate into the workforce. 

 

4. The impact of Reemployment on China’s Economic Growth 

China’s long-standing family planning policy has resulted in a significant decline in birth rates and a 

substantial population aging issue. The consequences of an oversupply in the labor market and the 

simultaneous increase in labor costs have compelled the country to expedite industrial upgrading and 

foster an innovative economy. To ensure the sustainable development of the innovation economy, it is 



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imperative to harness the full potential of high-quality talent. 

While historical statistics may not explicitly demonstrate the impact of economic growth on 

employment, the changing dynamics of the labor market structure have made the relationship between 

economic development and labor supply and demand more pronounced. Previously, the focus was 

primarily on analyzing capital, product, and industrial development. However, it is now crucial to shift 

people’s attention toward comprehending the intricate relationship between employment, 

unemployment, and economic growth. 

4.1 The Significance of Reemployment for Economic Development 

Maintaining a high level of employment is crucial for driving economic growth. Even during periods of 

economic slowdown, full employment creates a conducive environment for deepening supply-side 

structural reforms and accelerating transformation and upgrading. Conversely, a combination of high 

unemployment and low growth severely restricts the potential for economic expansion. 

In the current macroeconomic landscape, overcoming the constraints of labor shortage and rapid wage 

increases is essential to further increase the economic growth rate. The pressure on labor market supply 

compels the government and society to prioritize the development of innovation capabilities and 

improvements in production efficiency. Thus, maintaining a relatively high level of employment 

becomes a vital factor in promoting economic development. This not only ensures a stable labor force 

for the economy but also creates favorable conditions for deepening structural reforms and facilitating 

transformation and upgrading. Moreover, the pressure on labor market supply encourages a greater 

focus on enhancing innovation capabilities and production efficiency. By addressing the bottleneck in 

labor supply, we can elevate the economic growth rate and achieve sustainable development. 

4.2 The Imperative of Reemployment for Economic Development 

Unemployment exerts a significant impact on the economy, particularly in an era of low unemployment 

and sluggish growth following the pandemic. Formulating macroeconomic control policies becomes 

increasingly challenging under such circumstances. The global economic system has been disrupted by 

the COVID-19 pandemic, with developed countries implementing unprecedented monetary easing 

policies. This has resulted in excess global liquidity, triggering unprecedented high inflation and 

economic stagflation in some regions. 

Currently, there are lingering employment imbalances, and rapid economic growth may further 

exacerbate structural unemployment. In essence, the issue of employment reflects the underutilization 

of labor resources. With a population of 1.4 billion, China’s pursuit of stable employment encompasses 

not only aggregate concerns but, more importantly, structural considerations. Relying solely on 

stimulating overall employment levels yields limited effects and may even lead to stagflation. In this 

context, the significance of reemployment becomes even more pronounced. By promoting 

reemployment, we can achieve more comprehensive utilization of labor resources, alleviate pressure 

from structural unemployment, and enhance employment quality. Reemployment not only provides 

individuals with economic income and social security but also fosters a virtuous cycle of economic 



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development. Encouraging reemployment will boost consumer demand, invigorate the market, and 

create additional opportunities for enterprise development. 

 

5. Discussion 

The “high growth, low unemployment” phenomenon in China, with an average annual economic 

growth rate of 9.5% and an annual average registered urban unemployment rate of less than 4.5%, 

results from various contributing factors. China has implemented a series of necessary measures to 

achieve this outcome. 

Firstly, China recognizes the positive correlation between economic growth and employment expansion. 

This understanding has allowed China to pursue dual goals during its economic development process. 

Compared to other countries, China has maintained rapid and stable economic growth over an extended 

period, leading to the expansion of industries and a steady increase in employment demand. 

Secondly, China prioritizes stable employment and considers it a fundamental aspect of people’s 

livelihood. Employment has become the foundation and starting point for various economic policies. 

Through policies that encourage self-employment, China has witnessed a rapid decrease in the 

unemployment rate. Notably, during the international financial crisis in 2008, China promptly 

implemented policies and measures to stabilize growth, ensure employment, and promote people’s 

livelihood. As a result, it successfully avoided a sudden economic decline and a sharp increase in 

unemployment. 

Furthermore, industrial upgrading has played a crucial role. China’s industrial development has 

transitioned from labor-intensive to capital-intensive and technology-intensive sectors. The overall 

quality of the labor force has significantly improved, resulting in enhanced labor productivity and 

capital-output efficiency. This has effectively prevented the mismatch between labor and technology 

and mitigated the occurrence of “jobless growth” in China. The emergence of new economic forms and 

businesses, particularly within the tertiary industry, has not only become a new driving force for 

economic growth but also created numerous new occupations and jobs. The process of industrial 

upgrading has transformed the labor and employment system from “all-in-one contracting” during the 

planned economy era to a market-based employment system where independent job selection plays a 

significant role. The market mechanism has become decisive in allocating labor resources, and various 

labor markets, including state-owned, non-state-owned, rural, and urban labor markets, have played 

unique roles in regulating employment. 

Despite the evident policy effectiveness and China’s entry into a new era of economic development, the 

labor market still faces new challenges and constraints. Challenges persist for college graduates, 

migrant workers, unemployed individuals, entrepreneurs, and middle-aged and elderly workers. In 

recent years, with the advancement and application of intelligent manufacturing technology, China’s 

structural employment contradictions have become more pronounced. It is necessary to continue 

prioritizing employment, implementing an employment-first strategy, and addressing long-term issues 



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in the labor market faced by different segments of the population. Existing employment stabilization 

policies and measures should be reviewed, refined, and adjusted according to the new circumstances 

and tasks to ensure the sustainable coexistence of stable economic development and low 

unemployment. 

 

6. Conclusion 

In conclusion, this paper has discussed the current status of unemployment and reemployment 

difficulties in China in the post-epidemic context. The study highlights the importance of 

reemployment for economic growth and acknowledges the existing challenges and shortcomings in 

China’s reemployment policies. It emphasizes the need for macro-control of national policies and the 

active participation of enterprises to address these issues. While the analysis primarily focuses on the 

Chinese case, it provides valuable insights that can be applicable to the reemployment situation in other 

countries. However, it is important for other countries to conduct specific analyses considering their 

unique circumstances. In future research, the author intends to delve deeper into the topics of 

unemployment and reemployment in different countries and conduct comparative analyses to further 

enhance understanding in this area. 

 

7. Acknowledgement 

During the process of finishing this paper, all the teachers give me lots of help, giving me advises of 

how to improve the paper. 

 

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